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June 16, 2017

 

Finance committee approves additional CTE funding before budget negotiations stall
 

The Joint Finance Committee - the State Legislature's budget-writing committee - met yesterday after a two-week impasse due to disagreements on major budget items. While the committee took action on budget issues related to the Department of Corrections and voted down Gov. Scott Walker's plan to self-insure state workers, Republicans on the committee remain divided on how to fund K-12 education and the state's transportation budget. 

Before the delay in the budget process, the Joint Finance Committee (JFC) did take-up workforce development  issues, including the Career and Technical Education (CTE) Incentive Grant Program.  
Under current law, the CTE program provides grants to school districts to enhance technical education programming – and ultimately strengthen the state’s skilled workforce. The program provides $1,000 grants to schools for each high school student that graduates and earns an industry-recognized certification.

However, the program is capped at $3 million annually, and demand has outstripped supply. As a result, grant awards to schools re now being prorated. WEDA was
actively lobbying on a budget motion to make the program sum-sufficient so schools districts would be guaranteed full grant awards moving forward. Ultimately, JFC approved a budget motion to increase funding for the CTE program by $1 million over the 2017-19 biennium.

 

The committee also approved the governor’s recommendation to increase funding for Fast Forward grants by $11.5 million. The new funding will go toward additional workforce training programs, such as apprenticeships and internship programs.


As was reported in the last edition of Political News and Notes, the JFC took action on a handful of WEDA's key budget priorities last month, including the restoration of WEDC's capital lending program and increasing funding for rural broadband expansion. The committee has yet to take up the governor's proposed modifications to the historic tax credit program. WEDA is lobbying against the proposal, which would cap the popular redevelopment tool and tie future tax credit awards to job creation.
 

The JFC may meet again next Thursday, as the committee’s co-chairs said they are getting close to working out a deal on K-12 education funding. On the other hand, they also said reaching an agreement on transportation funding will be much more challenging.

Assembly GOP members of JFC prefer to find a long-term solution to funding the state’s transportation needs, including a potential gas tax increase. Senate Republican meanwhile are more aligned with Gov. Walker’s transportation funding proposal, which relies on more borrowing and project delays. However, tolling could be an acceptable funding option for both sides, as well as the governor who said he would be open to limited tolling in border areas of the state.


The JFC must also strike a deal on general fund taxes. The debate on taxes seems to be focused on whether the committee should approve the Gov. Walker's proposed income tax cuts, or delete his proposal and use the freed-up revenue to eliminate the personal property tax currently imposed on businesses.
 

While legislators on both side of the debate seem confident a budget deal can be reached over the coming weeks, confidence is fading that the budget will be passed by the statutory July 1 deadline. WEDA will keep members up-to-date on the latest state budget developments.

If you have any question or would like more information on the state budget bill and how it will impact economic development in Wisconsin, please contact WEDA at
mwelsh@weda.org.

 


 

  

Stay up-to-date on WEDA legislative activity


Although the state budget is the primary focus in the State Capitol, it's not the only game in town. Separate

legislative bill proposals continue to be introduced, and others are moving through the legislative process. And as economic and workforce development remains a top priority for many lawmakers, there is a consistent stream of legislation being considered that may be of interest to WEDA and its members.

 

Over the course of the session, the WEDA Legislative Committee will review numerous economic development-related bills and make a recommendation on whether to support, oppose or simply monitor any given legislative proposal. WEDA members can review the list of bills the association is following, the position taken by the Legislative Committee and Board of Directors, and the status of each proposal  on the WEDA Legislative Bill Tracker 

DARK STORE LEGISLATION

One legislative proposal of particular interest to WEDA is the so-called "Dark Store" legislation that was recently introduced as Assembly Bill 386 and Assembly Bill 387.

Under current law, a tax loophole - better known as the dark store loophole - is being used by Big Box retailers in Wisconsin an across the country to artificially lower their property taxes – and shift a greater property tax burden to homeowners and small businesses. These national retailers argue the market value of their active, thriving stores should be based on the sales of comparable sized vacant stores.

If the dark store tax loophole takes hold in Wisconsin, it will result in a considerable tax shift to homeowners and other property tax payers. From an economic development perspective, it could have a chilling effect on small business growth and a negative impact on main streets across Wisconsin.

While WEDA understands a competitive tax climate is necessary to facilitate business activity, investment capacity and job creation, the importance of tax fairness cannot be overlooked. The WEDA Governments Affairs Team is urging legislators to support the following two bills that would close the dark store tax loophole:

  • AB 386 - Requires assessors to consider certain factors when comparing properties to determine the value of a property for tax purposes. The bill also provides that an assessor cannot use a vacant store as a comparable when assessing the value of the property of an active store.
  • AB 387 - Clarifies that lease amounts must be factored into the valuation of leased properties for property tax purposes.

Both bills are tentatively scheduled for a public hearing the in Assembly on Thursday, June 29.

 


 

Quick Notes...


QN - Earlier this week, the Assembly approved a proposal on a 54-41 vote to include Wisconsin on the list of states calling for a constitutional convention on a federal balanced budget amendment. The bill is now headed to the Senate for further consideration. If approved, Wisconsin would be the 28th state added to the list. Approval by 34 states is needed to call a convention for proposing amendments to the U.S. Constitution. Link


QN - State Supreme Court Justice Michael Gableman announced today he will not seek re-election in 2018. Gableman, a conservative member of the high court, won his seat on the bench in 2008 when he defeated sitting justice Louis Butler. Madison attorney Tim Burns, Milwaukee Judge Rebecca Dallet, and Sauk County Circuit Court Judge Michael Screnock have announced their candidacy for the seat. Conservatives currently hold a 5-2 majority on the high court. Link

QN - According to the latest federal data released today by the WI Department of Workforce Development, Wisconsin's unemployment rate fell to 3.1% in May. The near-record rate is down from the 3.2% figure reported for April. It's the lowest unemployment rate in Wisconsin since October 1999. Link

QN - While visiting Waukesha County Technical College earlier this week to tout apprenticeship programs, President Donald Trump hinted at a major employer possibly moving to Wisconsin. The potential employer was eventually revealed as Foxconn, a Taiwanese company that assembles Apple iPhones. If the company ultimately chooses Wisconsin for its next U.S. location, it could bring thousands of new jobs to Wisconsin. Link

QN - The WEDC has provided $250,000 to the city of Oshkosh under the corporation’s Community Development Investment Grant Program to help finance public infrastructure costs of a new arena for the Milwaukee Bucks development team—the Wisconsin Herd. The $20 million arena is scheduled to be completed this fall. Link

QN According to a new poll conducted by the Wisconsin Transportation Development Association, 67% of respondents said they support raising new revenue to fund the state’s transportation needs. The poll, which survey 600 likely voters at the end of May, also showed that over 60% of respondents oppose delaying major highway projects in the Milwaukee area. Link



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